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ICO and Cryptocurrency FAQs

What is cryptocurrency? What's an ICO? How do I invest?

We get it. It's complicated! But you found yourself on icoalert.com and now you have no idea what to do next. No worries, we have you covered. Think of ICO Alert's FAQ as your home for crypto education. Here, we'll not only cover how ICO Alert works, but also some basic crypto questions and definitions to get you comfortable.

What is ICO Alert?

ICO Alert is the trusted ICO Discovery Platform, maintaining the only comprehensive list of active and upcoming Initial Coin Offerings. If you haven't heard of ICOs, you've probably heard of crowdsales, token sales, or token generation events. We cover them all.We serve more than a million unique users and have sent nearly half a million ICO Alert emails to notify users when new ICOs go live. In addition, we have publish in-depth ICO Alert Reports, offering insight into past, active, and upcoming ICOs.

We're constantly producing new content–from podcasts, to videos, and articles–to keep you informed on all the lastest trends in the ICO and cryptocurrency space.

What is My Portfolio?

This unique feature allows users to create an account on icoalert.com and save your own shortlist of Pre-ICOs and ICOs to keep track of. In a sense, this allows you to create your own personal investment portfolio. Create an account here.

What are ICO Alert Reports?

Exclusive, in-depth Q&A with a founder or high-level executive of a current ICO. Reports also provide relevant data about the project, as well as any restrictions or instructions on how to participate in the ICO.

What is an ICO?

ICO stands for “initial coin offering.” An ICO is essentially the creation and sale of digital tokens.In an ICO, a project creates digital tokens via a smart contract and sells them to the public. Contributions are typically made using existing cryptocurrencies, such as Ethereum or Bitcoin.As a new type of crowdfunding, ICOs enable startups to raise funds without giving up equity. Instead, you are purchasing the right to use a digital platform in the future that will provide utility (or equity) in some way. They also bootstrap products into existence by incentivizing adoption and usage from the initial token holders.

How do ICOs work?

Usually, an ICO will announce their project on bitcointalk.org (and other sites) and develop a website to attract potential investors. In most cases, investors will send common cryptocurrencies (BTC, ETH) to a smart contract address. This smart contract will then automatically return the ICO’s native crypto asset to the investor’s wallet.

What is a smart contract?

A smart contract is a self-executing agreement that converts contracts into computer code. This eliminates counterparty risk because assets can be stored in escrow(in a smart contract). Once a product has been delivered or a service has been performed, the funds can automatically be sent to the proper party via the smart contract. A smart contract works like a vending machine; as soon as you put money in, a product is then given to you.

What is a utility token?

A utility token is a digital asset that allows future access to a specific product or service. For example, SALT Lending issued a token that gives access to the lending platform in the form of a “membership.” Though not designed as an investment, many contributors purchase these tokens with hope that their value will increase over time.

What is an STO, or equity token?

An STO (Security Token Offering) is similar to the ICO model, except the tokens represent actual ownership interest in the company issuing the token. It is similar to traditional common stock, except it has key advantages.

Liquidity – Most STOs require a lockup period of 12 months, which is favorable to early stage venture capital lock up periods of several years.

What is a stablecoin?

A stablecoin is any cryptocurrency pegged to a stable asset, such as gold, USD, or other fiat currencies. Often times stablecoins are linked to a DAO (decentralized autonomous organization) which controls issuance and pricing.

Are ICOs safe?

The ICO market is extremely nascent, and therefore very unsafe for the unsophisticated investor. Investors should perform extensive due diligence before deciding to deploy capital. Here are some questions you should ask yourself:

Can I verify the existence of the team via LinkedIn or other social platforms?

How much time and effort was spent on producing a quality whitepaper?

Is the Github code repository active? Is it open source?

Are ICOs regulated?

Global regulation differs drastically given that the crypto space is so new. Currently, there are many legal gray areas; especially whether certain tokens are to be legally classified as securities. For more comprehensive information for various jurisdictions, see here.

What is a dApp?

A dApp is also known as a decentralized application. It consists of back-end code that runs on a decentralized peer-to-peer network. A dApp can also have a user interface, created by frontend code that makes calls to the backend. dApps do not require a central authority to function. They allow for direct interaction between users and providers.

What is a whitelist?

A whitelist ICO means that you have to register in advance to participate in the ICOs. Typically this is done through a web form sign-up on the ICO website. Sometimes potential investors will need to fulfill KYC obligations to register for a whitelist. KYC is short for “Know Your Customer,” which calls for the ICO to collect personal, identifiable information about each contributor.

What is a venture capitalist?

A venture capitalist (VC) is an investor who either provides capital to startup ventures or supports small companies that wish to expand, but do not have access to equities markets. Venture capitalists are typically willing to invest in such companies because they have the opportunity to earn massive returns on their investments if the companies succeed.

What is Ethereum's dominance?

Bitcoin's dominance is its percentage of the total cryptocurrency market capitalization.

Ethereum's dominance, is the total percentage of ICOs that are building dApps on top of the Ethereum blockchain. This is a useful statistic to consider when thinking about developer adoption of Ethereum and its competitors.

Where can I learn more?

We recommend signing up for blockgeeks, no matter your level of knowledge of blockchain and ICOs. They offer online courses ranging from introductory concepts to full on blockchain software development.